Alan Kohler and Warren Mosler on MMT

Alan Kolher maintaining the MMT rage.

David Llewellyn-Smith
Latest posts by David Llewellyn-Smith (see all)

Comments

  1. There is still a fundamnetal question as to how the RBA maintains independence and government maintains any sort of fiscal discipline under MMT. I think it’s already obvious in the US that the independence of the central bank is compromised under this scenario. The answer to every problem becomes “print more money”.

    • Who gives a shit anymore about “central bank independence”? Central banks have more in common with the CCP than anything democratic or market-based.

    • Yes, this is the only legitimate “criticism” of MMT. There has been very little work done about the specific institutional arrangements needed to implement it. It requires a very different bureaucracy. Much better inflation measures. Forensic targeting of public investment. Proper checks and balances.
      Our current bureaucracy can’t even implement a minimally targeted JobKeeper scheme.

        • Or run a VET loans scheme
          Or police early super access
          Or subsidise home insulation…

          Honestly they couldn’t organise a pi$$ up in the proverbial

      • Correcto …… imagine the rorts perpetrated if mmt was implemented by the current system !!!
        Gravy as far as the eye could see

    • No central bank is independent, in reality. Their salaries are paid by the State. The State also has the power to abolish the central bank and dictate who staffs it. CBs are an arm of the State that like to pretend they’re calling the shots.

      Arguing over the nuances of MMT is ridiculous – it’s money printing straight up. It doesn’t matter how you do it – it’ll have the same effect in the end ie. lots of inflation. End of.

      • Agreed, the notion of Central Bank independence is laughable. Your second statement however, just plain untrue on all counts. MMT is NOT “money printing strait up” far from it and am VERY tired at the fixation on and constant misunderstanding of this one element of what MMT teaches, while ignoring everything else that actually matters. Furthermore, money printing by itself does NOT necessarily cause inflation, it depends on how much, economic circumstances, context etc….so YES it does very much matter “how you do it”.

          • I see. Perhaps you can outline both your academic and professional qualifications so that I can treat your opinion on MMT with the respect it deserves.

            I have two post-grad degrees, one in Finance and the other in Financial Mathematics & Econometrics along with a 15yr career in investment banking. What do you have?

        • Not to worry Marcus, we’ll have to agree to disagree on that point — no problem with that. Everyone is welcome to their opinion, no matter what it is.

          • Well… though, you are only entitled to the opinions you can defend. Not any old [email protected] you put out there. Thats how people serve straight out lies and call it “their opinion and they’re entitled to it”.

          • Especially when banging on about economics and monetary function, seems some confuse ideological demagoguery a substitute.

            Funny though how some broad brush government in a negative light after decades of privatizing it, funding elections, and industry experts writing the laws from a corporatist perspective.

            This is in context to the most neoliberal country in the world the U.S. and how its panning out, considering all the trumpets been blown just before the GFC – its absurd.

          • I see Divya — perhaps you’d like to back your position up with something of substance? Oh, no you can’t – which is why you didn’t.

            I see the religious nutters are (inevitably) supporters of MMT.

          • Is that your professional opinion dom, anything to support it, you know like MMT does.

            I mean since Plaza and venture capital running the show and all.

          • Skip, anyone with an ounce of curiosity would actually read up on the history of money – just for a bit of background before they vomit their worthless thoughts all over the page. There are too many trigger-happy people who think they’re knowledgeable on a subject when they’re not. Half these trouser-stains have read one article in the Atlantic on the subject at some point recently, none of which they understood but it made an impression on them so they’re happy to regurgitate all the BS here as truth.

            If instead they’d held fire and done some work of their own they’d have quickly discovered that MMT has made an appearance numerous times over the past 1000+ years and failed every time. Of course, now that’s it’s been given a new shiny name, that changes everything and I’m sure it’ll work this time. Wheee …..

          • I have studied the anthropology on money, more so what preceded it and how it ebbs and flows throughout history.

            Nothing you just said above compels me to change that view, not that your just peddling a narrative.

        • Yes, Marcus, this economist agrees. We haven’t seen MMT here in Australia. The RBA still finances the deficit by selling bonds to the market. It’s as much a convention as anything I saw in the APS. Sure the laws around the budget bills and spending powers make it reasonably clear that federal taxes can be respent and form a budget base and this reflects the conservatism in the minds of those who constructed the legislation.

          Some earlier commenter mentioned not having structures to make MMT work for the people and one can only imagine the pork barrelling that would occur if the budget were limitless (which is essentially the inflation argument of giving money out beyond the economy’s capacity to absorb it). The thievery is out in the open anyway with the media’s blessing thrown in.

          No solutions from me. MMT explains how we could have great infrastructure, defence, a manufacturing sector. money for the environment, money for the needy… The harder task is to say how we might get there politically. Perhaps restricting MMT (ie not borrowing) to funding the pensioners and unemployed might be a start, but I won’t be holding my breath the way the world is turning right now.

      • Central banks want “inflation” yet can’t make it happen – ignoring of course the egregious fraud that is the CPI numberwang. If inflation is so bad, why do our esteemed technocrats covet it? Maybe they should give up on the Einstein-style definition of madness and instead try something different? BTW Investment banks will make out like bandits in a higher rate regime, they should be chomping at the bit for MMT.

  2. I’m increasingly of the unsubstantiated opinion that unmeasured unbridled MMT is coming.

    The fiat money system is almost dead. MMT is the last gasp of the Keynesians.

    That means cash is dead and gold bitcoin and silver to the moon. They will go TINA.